Starbucks Organizational Analysis Essay

10759 Words Jun 7th, 2011 44 Pages
Business Strategy

Organizational Analysis

Starbucks Coffee Company


Table of Contents

Executive Summary 3
Company History 4
Organizational marketing strategies 4 Starbucks as a Private Company (1987–92) 4 Starbucks as a corporation (1993-2010) 6
Organizational design and effectiveness 7
Starbucks Organizational Structure 9
External environment 9
Internal environment 11
International environment 13
Product and Service 14
Information technology and control systems 15
Organization size, life cycle, and possible decline 16
Organizational Culture 16
Ethical value 18
Innovation and change 18 Store Environmental Design 19 Sensory Innovation 19 Service Innovation 19 Consumer Education 20
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Starbucks coffeehouse store is nearly 17000 stores in 50 countries, including over 11,000 in the United States, over 1000 in Canada, and over 700 in the UK. In the Starbucks coffee stores, they sell drip brewed coffee, espresso-based hot coffee, other hot and cold drinks, and also provide salads, hot and cold sandwiches when their customers want to drink with coffee (Starbucks company official website).

Company History

In 1971, English teacher Jerry Baldwin, history teacher Zev Siegel and writer Gordon Bowker were university classmates in San Francisco University and also coffee drinkers. They were inspired by entrepreneur Alfred Peet and decided to invest the first Starbucks store selling high-quality coffee beans and equipment in Seattle WA. In the beginning of business, they opened six stores and only sold coffee beans. In 1982, current CEO Howard Schultz joined the company as Director of Retail Operations and Marketing. After a trip to Italy, he thought that American people were coffee lovers but they always drank at home. Therefore, he suggested the owners to sell coffee and expresso-based coffee as well as beans in order to increase business opportunities. However, the owners refused Schultz’s ideas and believed that selling beverage would distract the company from its primary focus so that they persisted only selling coffee beans for their business. In 1987, Howard Schultz bought Starbucks and made the
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